Car insurance basics and ways to lower your car insurance costs.
The key to finding cheap car insurance is understanding coverage’s, receiving car insurance discounts and to spend the time to shop several competitive sources.
Liability car insurance is mandatory in most states, liability car insurance covers damage to other peoples property and bodily injuries up to the policy limits.
Since liability car insurance is mandatory, it is advisable to compare your car insurance renewal rates at each renewal to be sure you are not overpaying for car insurance.
Having state minimum liability car insurance is the cheapest car insurance policy, a state minimum liability policy is probably not going to be enough coverage.
Be sure you understand the liability limits of your policy and how much you have to lose in the event you are sued over an at fault accident.
You would still be responsible for amounts above the policy limits.
Comprehensive and collision car insurance coverage is optional and would cover damages to your vehicle, in the event of an at fault accident
Comprehensive coverage aka other than collision (OTC) covers damages caused by things besides a collision. Some examples would be hail damage, fire or theft.
Collision coverage is to cover any type of collision with another vehicle, property or any other type of collision.
For comprehensive and collision insurance there is a deductible, the higher the deductible the lower the premium you will have to pay for you car insurance.
You are responsible for paying the deductible in the event you need to make a claim.
Other types of optional coverage’s provided by your car insurance policy is personal injury protection (PIP), medical payments, uninsured and underinsured motorist, rental car coverage, towing and some companies offer some type of roadside assistance coverage.
Personal injury protection (PIP) is similar to a small medical policy that covers everyone in the vehicle in the event of an accident. PIP will cover additional expenses such as lost wages. PIP coverage is usually sold in limits of $2500, $5000 or $10000.
Medical payments coverage is similar to PIP, it is like a small medical policy and is sold in the same limits as PIP, the main difference is it only covers medical and not additional expenses.
With comprehensive and collision coverage, some companies offer rental and towing coverage.
Rental car coverage is typically between $20 to $40 per day and is for a maximum of 30 days.
Towing cover’s vehicle disablement, towing limits usually range from $50 to $150 per disablement.
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